In its second major collaboration this year, Danish biotech NeuroSearch A/S inked a discovery deal with Johnson & Johnson unit Janssen Pharmaceutica NV for central nervous system disease drugs, a move that strengthens the company's balance sheet ahead of expected data from its late-stage Huntington's disease program. (BioWorld Today)
In its second major collaboration this year, Danish biotech NeuroSearch A/S inked a discovery deal with Johnson & Johnson unit Janssen Pharmaceutica NV for central nervous system disease drugs, a move that strengthens the company's balance sheet ahead of expected data from its late-stage Huntington's disease program.
NeuroSearch, of Ballerup, Denmark, had about DKK550.7 million (about US$100 million) as of March 31, enough cash to fund development activities through 2010.
The Janssen alliance adds another €32 million (US$45 million), including €5 million up front, €12 million in research funding over three years and €15 million in an equity investment from Janssen - €10 million initially, with an option for the remaining €5 million available through April 30, 2010.
On top of that, the company could receive up to €213 million in milestones plus double-digit royalties for each compound Janssen opts to take through development and commercialization in the CNS space. Specific disease targets were not disclosed, but terms call for NeuroSearch to handle drug discovery and early development of drug candidates, after which Janssen will decide whether to take programs forward.
The three-year alliance can be extended for up to two more years at Janssen's request, NeuroSearch earning additional research funding.
The deal is similar to a collaboration the company inked six months ago with Indianapolis-based Eli Lilly and Co., which called for up-front, research and equity funding of about $30 million, plus milestones of up to $320 million for each ion channel compound targeting the CNS space. (See BioWorld Today, Feb. 18, 2009.)
At that time, NeuroSearch A/S CEO Flemming Pedersen told BioWorld Today his firm was pursuing additional alliances, hoping for one or two more deals of that size.
Earlier this year, the firm also expanded an existing agreement with GlaxoSmithKline plc, adding preclinical compounds in exchange for undisclosed up-front payments and the chance to earn up to $140 million in milestones, plus double-digit royalties on any product sales. NeuroSearch and the London-based pharma firm previously had concluded a five-year collaboration, which produced a handful of preclinical candidates, though lead program NS2359, a triple reuptake inhibitor, missed hitting its endpoints in a Phase II trial in depression in February.
Another program, however, recently finished up preclinical development. That compound, NSD-721, a selective GABAA receptor modulator, is expected to begin Phase I testing in social anxiety disorder soon, triggering a €4 million milestone payment from GSK.
On its own, NeuroSearch continues focusing on ACR16 (pridopidine), a dopaminergic stabilizer, which is in two pivotal trials in Huntington's disease, with the first data anticipated by late this year or early next year.
The Phase III program is testing the drug's effects on voluntary motor function as measured by the modified Motor Score, a subscale of the Unified Huntington's Disease Rating Scale.
NeuroSearch holds worldwide rights to the compound - acquired in 2006 through its purchase of Swedish firm A. Carlsson Research AB - after one-time partner Tokyo-based Astellas Pharm Inc. decided to drop ACR16, also in development for schizophrenia, following a pipeline review.
Behind ACR16, NeuroSearch is advancing tesofensine, a monoamine reuptake inhibitor, set to start Phase III testing in obesity.
The company recently concluded an end-of-Phase II meeting with the FDA and expects to finalize a special protocol assessment, while continuing partnering discussions.
Shares of NeuroSearch (Copenhagen:NEUR) gained DKK8 to close Monday at DKK128.